Holiday 2018 Data Hub (Updated): Results Recap

By some accounts it was a strong holiday season. But after a delay in reporting its holiday season growth estimates as a result of the government shutdown (which curtailed Commerce Department reporting), the NRF’s figures aren’t quite so heartening for the industry.

Indeed the figures released last week – about a month later than usual – indicate that retail sales over November and December grew by just 2.9% to $707.5 billion last year, far below the forecasted growth rate of 4.3-4.9%. The NRF in its statement said the delay in collecting the data may have made the results less reliable, and also blamed the shutdown for depressed spending growth in December.

Indeed, while sales grew by 5.7% year-over-year in October (not counted as part of the holiday period, but still notable due to shopping patterns shifting earlier) and by 5.1% in November, December’s tally was just 0.9% higher than the year-earlier period.

Non-store holiday sales (including e-commerce) grew by 11.5%, as they did last year.

The NRF release reveals that all retail categories enjoyed modest increases save for Sporting Goods stores, which saw a hefty decline of 13.5%, and Furniture and Home Furnishings Stores, which saw flat sales.

Last year, by contrast, Furniture and Home Furnishings Stores had one of the highest growth rates, as did Electronics and Appliance Stores, which this year were up by just 0.2%

Clothing and Clothing Accessory stores were the only store types to beat the overall growth rate, with sales up 4.2% at $61.7 billion.

Here are some further highlights and results are reported by various sources.

Mastercard

Mastercard’s SpendingPulse data showed the strongest growth in the last six years, with holiday sales up by 5.1%.

Online shopping had yet another double-digit uptick, with gains of 19.1% on the previous holiday season, defined as November 1 through December 24.

A category performing particularly well was home improvement, up by 9% and buoyed by increased interest before the holiday period. Apparel also saw the best growth rate since 2010 (up 7.9% year-over-year).

Although the news is on the whole positive for growth, SpendingPulse did highlight the effect that inclement weather can have on consumer spend during prime time shopping periods. Cold weather impacted Black Friday morning sales on the East coast, while wet weather on the weekend of December 15-16 impacted both East and West coast sales. This likely fed into department stores’ 1.3% decline for the season, with another contributing factor being increased store closings during the year.

First Data

First Data’s analysis [infographic] of aggregated merchant processing data reported an overall growth of 3.4% for the holiday period. Retail accounted for the largest share of spend at 38%, while the sector with the highest percentage year-over-year growth was hotel, travel and leisure (up 5.4%). Male shoppers had electronics stores as their favorite category, with female shoppers spending most at discount stores.

Growth rates did differ significantly across metropolitan areas: while Seattle saw year-over-year growth of 7.4%, in Philadelphia it was just 2.9%.

First Data also reported that Tuesdays were the busiest non-holiday shopping days, with the period running December 18 through December 21 seeing some of the highest volumes overall for December.

Adobe Digital Insights

Adobe Digital Insights (ADI) jumped on the e-commerce bandwagon, reporting higher growth rates for online shopping in 2018 (+16.5% year-over-year) than in 2017 (14.7%) and 2016 (14.4%). In total, US consumers spent $126 billion online for the period of November 1 through December 26, per ADI’s tally.

The five-day period from Thanksgiving through Cyber Monday accounted for almost $1 in every $5 spent with online retailers. The post-Thanksgiving period was by far the strongest, with consumers spending an average of 40% more per day during the three weeks after Cyber Monday versus the first three weeks of the season.

Mobile also took the lead for site visits for the first time, accounting for 51.4% of the total. Around a third (31%) of all sales were made through smartphones for the season. Christmas Day was the peak day for smartphone share, representing 61.1% of visits and 42.3% of revenue.

Multichannel retailers mixing bricks and mortar with e-commerce saw a 50% increase in the use of BOPIS (buy online to pick up in store), but baskets typically only had two or three items in them, representing an opportunity to upsell once shoppers arrive at the store.

Criteo

Retailers shouldn’t rest on their laurels come December 25, as Criteo reports the period between Christmas and New Year is a time when sales lift as shoppers redeem gift cards or return unwanted gifts to stores.

This so-called “Cyber Week II” might be nowhere near as big as Black Friday et al, but it does represent an opportunity for retailers to drive further revenue toward the month’s end.

Amazon / Hitwise

The 800-pound gorilla of e-commerce got even larger this holiday period, with its devices being both sold and used in record numbers, according to its press release. In a sign of its increasing dominance in the world of voice technology, use of Alexa for shopping over the holidays tripled compared to the same period last year. Alexa was used nearly twice as much on Fire TV devices as in the year-earlier period, with 8x as many reminders being set year-over-year.

Newsletter subscribers to MarketingCharts may also have noticed that Alexa-enabled devices accounted for three of the top 10 most viewed products for the week ending December 23 (sign up for free access to this weekly data).

Hitwise confirmed Amazon’s massive lead over other retailers [download page], with the giant accounting for 42% of site visits, far ahead of Walmart (10%), Apple (5%) and Target (5%). By transaction share Amazon performed even better, accounting for 71.9% of the total – with 40 million Americans buying exclusively on Amazon during this past holiday season.

ICSC

In comforting news for physical retail, the International Council of Shopping Centers (ICSC) reported – based on a post-holiday survey – that 93% of holiday shoppers spent at a bricks and mortar store, while 70% of adults went to a mall or shopping center this season.

Top reasons for choosing Main Street over online included the ability to touch and see items (41%), being able to get items immediately (40%) and looking for better prices and promotions (37%).

Button

Analysis of sales [report download] made by smartphone through e-commerce tech platform Button highlighted the impact of both app usage and Cyber Week on overall holiday sales.

Customers shopping through an app converted at a rate 14% higher than those coming through mobile web. For Cyber Week, 7 in 10 shoppers were new users, and a significant proportion of these were retained – 1 in 3 of those that had made a purchase in the post-Thanksgiving period ended up making another purchase within 45 days.

Previously Published: Cyber Week Recap

With Thanksgiving weekend and Cyber Monday (mercifully?) behind us, shopping results are coming out from several sources. Although the precise figures differ from one source to the next, it seems that yet again the key takeaways include a new record for e-commerce spending on Cyber Monday and more gains in mobile commerce.

The following recap offers highlights from several research sources, with links provided for readers who would like to explore the data in more detail. (Note that there is a considerable amount of data not covered below, so we encourage you to follow the links to see what each source has to offer.)

In its recap, Adobe Digital Insights reveals thatCyber Monday was the largest online sales day in US history, with $7.9 billion spent by the end of the day, up 19% and besting last year’s growth rate of 17%. Of the total spending online on Cyber Monday, mobile devices accounted for more than one-third – at $2.8 billion – representing a 41% increase, including a 56% gain for smartphones. Direct website traffic drove the most revenue (25.3%) on Cyber Monday, followed by paid search (25.1%), email (24.2%) and natural search (18.8%). Social media (1.1%) continued to be a bit player.

Advertisers certainly caught onto the trend for mobile and also for search: year-over-year spending on mobile search ads increased by 44% for Thanksgiving Day and by 43% for Black Friday. So says Kenshoo, which also declares “which high certainty that advertiser ROI not only held firm in light of these market-inflated prices but even improved on Black Friday compared to early November.”

In its holiday report, Comscore agrees that Cyber Monday had the highest e-commerce spend ever (tallied at $6 billion), as each of the three key days (Thanksgiving, Black Friday and Cyber Monday) posted year-over-year e-commerce sales gains of at least 28%. Notably, Thanksgiving was the mobile mobile day, per Comscore’s data, with the devices reaching 40% share of total digital commerce.

As for the broad Thanksgiving weekend (Thursday through Monday) period, Adobe Digital Insights reports a 23% increase in e-commerce sales. E-commerce grew most quickly on Thanksgiving Day again, up a massive 28%, compared to 18.3% growth last year. Notably, mobile accounted for an impressive 41.7% of the total e-commerce sales over the 5-day period and a majority 54.3% of the retail traffic.

Adobe’s report also notes that the weekend between Black Friday and Cyber Monday was the largest weekend ever in the US in terms of e-commerce sales. Figures from Verizon’s Holiday Retail Index – which monitors traffic to the top 25 US-based online retailers – support that finding. E-commerce traffic for Saturday November 24 was up by almost 30% year-over-year, per Verizon, while traffic the following day was up by roughly 23%. Lending more support to the growing influence of the weekend is Bazaarvoice, which tracked the highest growth in total page views within its network of monitored retail sites on Saturday November 24. The day also tied with Thanksgiving Day as the one to have the highest share of mobile orders (51%). Meanwhile, Sunday had the second-highest growth in total revenue, mobile revenue and average order value, per Bazaarvoice’s data.

Another to note the growth in off-peak days is Hitwise, which also revealed that the day before Thanksgiving had a large 40% year-over-year increase in transactions with the Top 50 Retailers. Meanwhile, on Thanksgiving Day Amazon hogged almost half (47.8%) of all online transactions with the Top 50 retailers, more than half (56.8%) on Black Friday, and 60% on Cyber Monday. That’s down from its average 79% of transactions from January through October, though, owing to competition from other retailers.

Cyber Monday online shopping peaked late in the evening, reveals Adobe, while data from SAP Commerce Cloud indicates that on Black Friday the busiest hour was 1PM ET. Most orders, however, were placed during the hour of 2PM ET, which was also the hour when the highest conversion rate was witnessed.

While it was a record-breaking Cyber Week, there were some headwinds. Data from Monetate indicates that bounce rates were up in the US by 12% on Thanksgiving and by 5.2% on Black Friday. Broadening the analysis to include Canada and the UK and looking at Thanksgiving, Black Friday and Cyber Monday, the data shows that cart abandonment rose by an average of 5.4%, suggesting that consumers are shopping around more before making final decisions.

Data in previously-published research suggests that most shoppers gained during the holidays will come back to a retailer. That’s great news considering this stat from Bluecore: 57% of all Black Friday purchases were made by first-time buyers. Bluecore isn’t quite as optimistic about their retention, but still expects that about one-fifth (21%) of these new customers will become repeat buyers.

How big were the discounts on Cyber Monday? Average online discounts hit 31%, reports Salesforce, with these deals coming with free shipping 84% of the time. That’s the highest average discount rate that’s ever been recorded by Salesforce’s Shopping Index. Salesforce also revealed a year-over-year increase in the number of retailer email sends on Cyber Monday, as well as a huge 69% jump in the number of SMS and push notifications sent.

It’s worth remembering that e-commerce is just one part of the total retail picture… Indeed, only 1 in 4 Cyber Week shoppers shopped exclusively online, according to the NRF. Instead, 54% shopped both in-store and online, while 21% made their purchases only in-store. The multichannel shoppers also outspent the single-channel shopper by almost $100 ($93) on average, a large gap considering that the average shopper spent $313.29 over the 5-day period. (This finding – of larger spend by multichannel shoppers – is consistent with previous data from Criteo.) Meanwhile, the NRF also reports that slightly more people shopped online on Cyber Monday (67.4 million) than on Black Friday (65.2 million), but that the most popular day for in-store shopping was Black Friday (67 million). Those figures also suggest that more people shopped in-store than online on Black Friday. Overall, about 165 million people shopped during the 5-day period, per the NRF, though that was down from roughly 174 million last year.

Survey findings from the International Council of Shopping Centers (ICSC) indicate that retailers with both a physical and online presence captured 88% of spending on Thanksgiving Day and Black Friday. More than one-quarter (27%) of shoppers used click-and-collect on those days, with almost two-thirds (64%) of those making an additional purchase in-store.

For its part, ShopperTrak reported that store traffic for the Black Friday weekend (Thursday through Sunday) was down by only 1.5%, a smaller decrease than observed last year (-2.2%). However, Cyber Monday may have shifted more online, as brick-and-mortar traffic that day was down by 7%, compared to a 2% decrease last year.

Finally, the Consumer Technology Association (CTA) says that for the first time ever, more tech gift shoppers bought or planned to buy online (59%) over the 5-day period than to buy in-store (58%), though that difference is essentially within the margin of error and therefore not significant… Meanwhile, tech gift shoppers were more apt to say they shopped online on Cyber Monday (54%) than on Black Friday (48%).

Pre-Thanksgiving Research

The holiday season has begun, which means that dozens of studies are being issued forecasting spending trends, retail destinations and shopping attitudes. This latest annual data hub (which will be updated periodically during the holiday period) highlights key points from holiday-related research for what looks to be an enthusiastic season in terms of consumer spending.

[Editor’s Note: As with last year’s holiday data hub, this year’s article will highlight one or two unique findings from each piece of research. Readers interested in more data are encouraged to follow the links provided to access the studies.]

Forecasts

Before getting to the list of research highlights and Thanksgiving shopping intentions, let’s a look at the broad forecast for this holiday season.

The NRF is projecting a 4.3-4.8% increase in holiday sales this year to roughly $679-$682 billion. The forecasted growth rate is higher than the 5-year average of 3.9%. It’s also well above last year’s forecast of 3.6-4% growth, though below the 5.3% increase that the holiday season ended with. Consumers themselves expect to spend 4.1% more this year than last, per a separate survey released by the NRF.

The NRF’s forecast increase sits below the gain expected by Deloitte, of a 5-5.6% increase. That’s up from a predicted 4-4.5% rise last year, and includes an impressive 17-22% growth predicted for e-commerce sales.

Adobe Digital Insights (ADI) is out with a projection that e-commerce growth during the holidays will be 14.8%, up from last year’s projected 13.8% increase.

The International Council of Shopping Centers (ICSC) is in with the trend for holiday spending growth this year, expecting a 4.5% rise in holiday sales, above last year’s forecast increase of 3.8%.

eMarketer is uncharacteristically upbeat in its projections, raising its earlier forecast to predict a 5.8% increase in retail holiday season sales, including a 16.6% gain for e-commerce sales. Expect holiday season sales to top $1 trillion for the first time, eMarketer says, buoyed in part by the maximum number of possible days between Thanksgiving and Christmas.

Finally, Forrester might again have the most modest forecast for online holiday sales in the US, expecting a 14% increase from last year, although that’s up from their 12% growth projection in 2017. NetElixir is only slightly more buoyant in its outlook, predicting a 15% year-over-year gain in e-commerce revenues, though that would be up from 13% last year and 10% the year prior.

Thanksgiving Week

Some 164 million Americans are planning to – or considering – shopping online or in-store this Thanksgiving weekend (Thursday through Monday), according to the latest holiday survey from the NRF. That figure is unchanged from last year, when similar estimates called for 164 million to shop during the 5-day period.

The most enthusiasm for Thanksgiving weekend in the NRF survey is reserved for Black Friday: 71% of those who plan to shop on Thanksgiving weekend said they either will or might shop that day. That compares to slightly fewer than half (46%) who might shop on Cyber Monday, and about one-fifth (21%) on Thanksgiving Day.

Here are some further statistics regarding key shopping days over the 5-day period.

Globally, Cyber Week – starting the Tuesday before Thanksgiving and extending through Cyber Monday – will account for 40% of digital revenues during the holiday season, with Black Friday (10% share) edging Cyber Monday (8%). So predicts Salesforce in its own forecast. (Link).

Within the US, the Thanksgiving Weekend (Thursday through Monday) is expected to generate almost one-fifth (19%) of total online holiday sales, according to Adobe Digital Insights, which also notes that online revenue growth during that period will outpace online sales growth during the entire holiday period. Cyber Monday will continue to be the key day, with the highest predicted sales ($7.8 billion) and the fastest growth (+17.6% year-over-year). (Link)

Retailers are all in on the game. Research from Nanigans indicates that retailers will apportion one-quarter of their holiday digital ad budgets to the Black Friday-Cyber Monday weekend. (Link).

Cyber Monday might – as its name suggests – be the heaviest day for online spending, but Black Friday will be the busiest day for in-store traffic, according to a ShopperTrak forecast. Traffic should peak at 4PM that day, per the prediction. (Link) A separate survey from Euclid disagrees, finding more shoppers planning to go in-store on Thanksgiving (30%) than Black Friday (28%). (Link)

Shoppers expect to spend an impressive 46% more this Thanksgiving weekend (excluding Cyber Monday) than last, according to a survey from the ICSC. (Link).

The ICSC expects the vast majority of spending to occur in-store, and the Consumer Technology Association indicates that more people will shop for tech products in-store than online during the 5-day Thanksgiving period. Separately, the CTA survey finds that 85% of US shoppers plan to buy tech devices during the critical shopping period, with smartphones and TVs (the most common devices in US households) tied for the lead in shopping intent. (Link)

Whatever they’re buying, they seem to be shopping more. Data from Comscore indicates that the 6 days running from Thanksgiving Day through Cyber Tuesday accounted for 17.7% of desktop e-commerce sales last year, up from 16.8% in 2016 and 16.2% in 2015. (Link)

Data from Monetate suggests that average order values last year were higher on Thanksgiving ($154.15) than on Black Friday ($142.86). Interestingly, the analysis shows that abandoned cart values grew leading up to Thanksgiving last year, suggesting that people were shopping beforehand but putting off their purchases till Black Friday.

Other Key Holiday Data

The following list highlights key points from the studies cited above, along with several others. We’re generally disregarding data regarding top gifts and shopping times, as the surveys disagree widely with respect to these. (You can follow the links to the research to find each one’s results on those.)

Likewise, we’ll largely avoid shopping destinations data for the same reason, unless there are noteworthy results to highlight.

One such prediction worth pointing out comes from Deloitte, which on the basis of its consumer survey believes that a majority of holiday budgets will be spent online (57%) rather than in-store (43%) or via other means. Likewise, survey data from Adobe Digital Insights finds consumers claiming they’ll spend 57% of their holiday budgets online, up from 55% last year. It’s hard to imagine that a majority of holiday sales will come from e-commerce, given US Department of Commerce data [pdf] indicating that e-commerce sales accounted for 9.1% of total retail sales during Q4 2017.

And while the NPD Group reveals that online shoppers plan to spend 50% more than in-store shoppers, the empirical figures make it hard to see how that will translate to a majority of holiday spending occurring online. (Other research, such as from Adobe Digital Insights and eMarketer, also expects e-commerce to account for a fractional amount of total retail sales – with ADI pegging it at one-sixth.)

Here are some highlights from the myriad surveys and other research pieces that have been released in recent weeks. Links to the research are provided at the end of each bullet point.

Half of holiday purchases could be influenced by retailers, per Deloitte, as only 51% of respondents typically shop for specific items they they’ve planned to buy before entering a store. Think it’s all about gifts? Not so, per Deloitte. In fact, shoppers expect to devote a larger share of their holiday spending to experience purchases (40%) than to gift purchases (34%). (Link)

In light of the above result concerning promotions, it’s worth noting survey results from the ICSC revealing that almost half (47%) of shoppers indicate that once they’re in a store, the promotions they see influence the holiday purchases they make. (Link)

More than 8 in 10 consumers (84%) plan to shop at a store where they’re a rewards member in order to earn discounts and/or rewards point, according to a Citi Retail Services study. (Link).

When looking for gift ideas, the majority (54%) of consumers look to recommendations from friends and family, according to Bazaarvoice. Notably, 43% report being inspired by advertising, compared to 27% by social platforms such as Instagram and Pinterest. (Link)

Some 61% of consumers will not buy something online this holiday season if it doesn’t come with free shipping, RetailMeNot has found. A separate RetailMeNot survey of retailers indicates that the majority will focus their efforts the most on Millennials as opposed to Gen Xers or Baby Boomers. Millennials surveyed are largely searching for deals, expecting personalized shopping experiences and looking for instant gratification with gifts in hand as soon as possible. (Link). Retailers may be onto something with their focus on youth: Millennials and Gen Z consumers are the most likely age groups to say they’ll spend more this holiday season, per survey results from Discover. (Link) PwC research agrees: the consumer segments most likely to be spending the same or more than last year are high-earning Millennials (92%), Millennial dads (89%), people from large metro areas (89%) and Hispanic Millennials (87%), per PwC. That report also indicates that brand trust influences shopping decisions for 7 in 10 consumers. (Link)

Almost half of visits to retailers will come from smartphones this holiday season, says ADI. Interestingly, the study data suggests that customers acquired during the holidays are as likely to return to a retailer’s website over the following 6 months as customers acquired at other points of the year. (Link) That could make a lot of retailers happy, given Google and Ipsos survey data indicating that almost half (46%) of shoppers purchased from a new retailer during the 2017 holiday season. (Link)

Retail ad spending should grow by 2-4% during the November-December period, reports Kantar Media, noting that Walmart began its holiday advertising on October 29 and Target on October 31. Both retailers promoted free 2-day shipping, likely in response to Amazon. (Link)

As regards Amazon, fully 8 in 10 holiday shoppers claim that they’ll start their gift searches on Amazon this year, research from CPC Strategy has found, up from 72% feeling that way last year. (Link). Separately, a survey from Valassis found evidence for “Christmas in July,” with 40% of holiday shoppers having purchased some part of their holiday gifts on Amazon Prime Day. (Link)

In response, retail and e-commerce brands will be spending on Amazon ads, according to ClickZ and Kenshoo. Those brands who plan to run such ads this holiday season expect to dedicate more than one-fifth (21%) of their budgets to the platform, with Christmas-specific campaigns (82%) and Black Friday-dedicated campaigns popular. (Link) Meanwhile, retailers have already upped their ad spend by 3% year-over-year, according to data from Standard Media Index.

Globally, smartphones (46%) will overtake desktops (44%) for holiday digital transaction share for the first time, per Salesforce, while Instagram will be the fastest-growing social referrer of traffic to retail sites. (Link)

Holiday spending on tech devices and accessories will grow by 3.4% as two-thirds of US adults plan to buy a tech product during the holiday season, according to the CTA. While the traditional mainstay – TV sets – is atop the wish lists again, consumers will spend more than ever on emerging technologies including smart speakers (18% intending to purchase), smart home devices (36% planning to buy), and smartwatches (almost 1 in 5 intending to buy). (Link).

Electronics should dominate the list of hot products on Amazon this holiday season, says Hitwise, based on an analysis of top searches and product pages on the platform in recent days. The early signals suggest that LEGO, Nerf and LOL Surprise will be among the best-performing toy brands.